SECRETARÍA DE ESTADO DE INFRAESTRUCTURAS Y PLANIFICACIÓN
MINISTERIO
DE FOMENTO
DIRECCIÓN GENERAL
DE PLANIFICACIÓN Y
COORDINACIÓN TERRITORIAL
CENTRO DE ESTUDIOS
Y EXPERIMENTACIÓN
DE OBRAS PÚBLICAS
Encuentro:
“Tarificación”
Infrastructure charging
Xavier DELACHE
Service
économique
et statistique
Madrid, 25 de octubre de 2004
DAEI/SES
ministère
de l’Équipement
des Transports
de l’Aménagement
du Territoire
du Tourisme
et de la Mer
direction
des Affaires
économiques
et internationales
Service
économique
et statistique
Infrastructure charging

Overview of european practices

Some issues in France
CEDEX Seminar ; Madrid, 25 de octubre 2004
Xavier DELACHE
Views expressed don’t reflect the Ministry’s position
Overview of european practices
Available instruments for cost-internalisation can be
summarized as fuel taxes ; vehicle taxes ; charges
Historically, main charging instruments used by
governments are fuel and vehicle taxes
Fuel and vehicle taxes have been recently eco-redesigned
But re-designing these instruments prove to be difficult
– Fuel taxes are a key EU competition debate (road and aviation)
and become sensitive in the oil price context
– Vehicle tax policies are long term policies (stock) and prove to
be also competition-sensitive (cf. french project in 2004) ;
– Environmental fuel / vehicle tax policies need to be fine-tuned
And taxes are not always relevant to the cost structure
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• Geographical differenciation
• Time differenciation
• Vehicle and generation differenciation
DAEI/SES
Overview of european practices
Relevance of pricing instrument to cost structure
Cost item
Marginal
infrastructure costs
Safety
Greenhouse effect
Atmospheric
pollution
Noise
Congestion
1st preference
Differenced charge
per kilometre
Through insurance
premiums
Fuel excise duty
Differenced charge
per kilometre
Differenced charge
per kilometre
Congestion charge
2nd preference
Excise duty
3rd preference
Ownership tax
Differenced charge
per kilometre
Differenced charge
per kilometre
Fuel excise duty
Excise duty
Fuel excise duty
Ownership tax
Ownership tax
Differenced charge
per kilometre
Source : EEA, september 2004
Service
économique
et statistique
DAEI/SES
Overview of european practices
Congestion is a central issue and an increasing precursor of pollution
Service
économique
et statistique
DAEI/SES
Overview of european practices
Recent european initiatives have focused on charging instruments, e.g. :
Urban ( ~ cars) :
– London : 5 £ per vehicle entering the 21 km2 toll zone (impact after 1 year
traffic : -20 % ; time lost in congestion : -30 % average speed : + 20%)
– Randstadt (NL - project surrendered in 2001) : 2,5 € per vehicle
– Rome : inner city vignette
– ( N.B : Parking charging is always somewhere under revision in EU)
Road ( ~ trucks) :
– Germany (law of 2003) : average charge of 12,4 c € / km for vehicles > 12
t (cf. implementation issues)
– Austria (law of 1996 ; implementation 2004) : charge of 13 to 27 c € / km
for vehicles > 3,5 t
– NL (project surrendered in 2002)
Air(ports)
– Swizerland : landing charges based on air emissions (+40% when
Service
pollution index is 100% higher)
économique
et statistique
– Various countries : landing charges differenciated on noise level
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Overview of european practices
Service
économique
et statistique
EEA, september 2004
Non-fuel-related taxes and
charges
Air
Rail transport
Aviation
Water transport
Road - freight
Road - passenger
CO2
Rail transport
Aviation
Water
Road - freight
Road - passenger
Lower tax for low-sulphur
Carbon tax on fuel
A B D F F G G I
K I
E R R
N
R
E
X
X
X
X
X
X
X
X X X
X
L N P E S U
U L
K
X
X
X X X X X
X X
X X X
X
X X
X
X X X
X X
I
X
X
X
X
X X
X
DAEI/SES
Overview of european practices
Non-fuel-related taxes and
charges
Noise
Congestion
A B D F F G G I
K I
E R R
N
R
E
Rail transport
Aviation
X
Water transport
Road - freight
X
Road passenger
Rail transport
Aviation
Water transport
Road - freight
Road passenger
X X
I
X
L N P E S U
U L
K
X
X
X X
X
X
X
Service
économique
et statistique
DAEI/SES
Overview of european practices
Nethertheless, recent european initiatives / experiences
have faced implementation issues
–
–
–
–
Monitoring technologies / costs
Low social acceptability
Poor awareness / misunderstanings on environmental impacts
Incoherence / competition / conflict between local and national levels
 Some guidelines
Shared assessment of cost and pricing principles (cf. France)
Cross-incentives between geographical policy levels
Acceptability of pricing schemes
Service
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– Focus on transport policy not only on environment
– Raise awareness and promote the project by alternatives scoping
– Assess distributive issues, activities re-localisation and citizens
expectations (declared preferences # revealed through traffic models)
– Implement step by step ; under-price at the beginning
DAEI/SES
Some issues in France
From an assessment point of vue, main pricing issues cover :
–
–
–
–
Road traffic
Vehicle taxes
Urban traffic
Air traffic
There is a common basis and language for project appraisal
and pricing policies  consistency among instruments
– « Boiteux » report 2001 : common value for external costs
– Well documented price-elasticities (fuel and charges)
Less available assessment on :
Service
économique
et statistique
–
–
–
–
landscape / fragmentation costs
urban issues
aviation external costs
elasticities of vehicles taxes subsidies
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A common assessment basis 2001
Interministerial report based on litterature
review and independant expertise
Covers :
– Value of life
– Value of time
– External costs : air ; noise ; climate
Service
économique
et statistique
Transcripted in appraisal rules in march 2004
Used to assess road pricing policy in 2003
Used to assess vehicle taxes polices in 2004
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A common assessment basis 2001
Life values :
–
–
–
–
–
Death avoided : 1500 K €
Heavy injured avoided : 225 K €
Injured avoided : 33 K €
Road abatment (self insurance) : -33%
Increase over time : value of consumption per capita
Green house gases value : 100 € / tonC
Increase over time : + 3% annual
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économique
et statistique
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A common assessment basis 2001
Noise values : lost of asset value
Level of noise (dB)
55-60
60-65
65-70
70-75
> 75
Loss of value
0,4%
0,8%
0,9%
1,0%
1,1%
Increase over time : value of consumption per capita
Service
économique
et statistique
DAEI/SES
A common assessment basis 2001
Air Pollution
(€ / 100 Veh-km)
Urban
Semi-urban
Countryside
Average
Cars, vans
2,9
1,0
0,1
0,9
Trucks
28,2
9,9
0,6
6,2
Buses
24,9
8,7
0,6
5,4
Rail freight
458
160
11
100
Rail passengers
164
57
4
36
(€ / 100 train-km)
Service
économique
et statistique
Increase over time : value of consumption per capita
DAEI/SES
A common assessment basis 2001
•
Comparaisons with INFRAS and Marco-Polo
(€ / 100 Veh-km)
Boiteux
(average)
INFRAS 2004
Cars, vans
0,9
1,8
Trucks
6,2
26
Buses
5,4
24,7
Rail freight
100
444
Rail passengers
36
33,7
Marco-Polo
6,9
(€ / 100 train-km)
276
Service
économique
et statistique
DAEI/SES
A common assessment basis 2001
•
Comparaisons with INFRAS and Marco-Polo
Differenciations
Boiteux
INFRAS
2000
Zones ; field versus urban (cars)
1 to 30
1 to 6
Zones ; field versus urban (trucks)
1 to 30
1 to 10
Pollution : Euro 4 versus Euro < 1 (cars)
NA
1 to 3
Pollution : Euro 4 versus Euro < 1 (trucks)
NA
NA
Service
économique
et statistique
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Some issues in France (ctd)
Road traffic :
– To what extent is (truck) traffic under-priced ?
– To what extent is geographical and peak-off peak
differenciation needed ?
Vehicles taxes
– Can incorporation of technical progress in fleets be
fastened at a reasonable costs while avoiding
opportunistic behaviours ?
Urban
– Can scarce-space policies avoid or only postpone
congestion charges ?
Air traffic
Service
économique
et statistique
– Can airport charges be a substitute to international fuel
taxes or en-route charges ?
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Road traffic : prices and costs
Study on prices and marginal costs (2003) on
the road network
– for different vehicles
– on various types of infrastructures
(motorways ; trunck roads ; local roads)
– in various locations (urban ; field ; mountain)
– in peak or off-peak periods
Service
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Marginal costs = infrastructure maintainance +
congestion + accidents + noise + air + climate
External costs based on 2001 report
Prices = fuel excice duties + taxes on vehicles
+ taxes on insurance + tolls
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Road traffic : prices and costs
Agregate results
Service
économique
et statistique
Prices / marginal costs
Trucks
Cars
Vans
All
National network
0,98
1,39
1,33
1,23
Toll motorways
National roads
1,83
0,59
3,46
0,79
3,88
0,70
2,74
0,71
Other networks
0,39
0,84
1,05
0,79
Provincial roads
Vincinity roads
0,39
0,37
0,79
0,91
1,09
1,02
0,75
0,86
Total
0,75
1,02
1,16
0,97
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Road traffic : prices and costs
Infrastructure
Trucks (c  : veh-km)
Service
économique
et statistique
Marginal costs
Off-peak
Price
Peak Taxes Toll
Urban toll-free motorway 2* 4
42,2
65,2
16,3
0
Urban toll-free motorway 2 * 3
41,5
64,5
16,3
0
Sub-urban toll-free motorway 2*3
22,5
45,5
13,0
0
Sub-urban toll motorway 2*3
21,4
44,4
13,0
11,0
Sub-urban toll free motorway 2*2
17,3
40,3
13,0
0
Field toll motorway 2*2
8,0
8,0
13,0
12,0
Field toll-free motorway 2*2
8,0
8,0
13,0
0
Montainous toll motorway
35,4
35,4
19,5
20,0
Field national road
10,9
33,9
14,3
0
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Road traffic : prices and costs
Infrastructure
Cars (c  : veh-km)
Service
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Marginal costs
Off-peak
Price
Peak Taxes Toll
Urban toll-free motorway 2* 4
5,8
15,8
5,6
0
Urban toll-free motorway 2 * 3
5,1
15,1
5,6
0
Sub-urban toll-free motorway 2*3
3,1
13,1
4,9
0
Sub-urban toll motorway 2*3
3,6
13,6
4,9
6,1
Sub-urban toll free motorway 2*2
2,6
12,6
4,9
0
Field toll motorway 2*2
2,4
2,4
4,9
6,2
Field toll-free motorway 2*2
1,7
1,7
4,9
0
Montainous toll motorway
5,5
5,5
5,4
9,6
Field national road
3,9
13,9
5,1
0
DAEI/SES
Road traffic
Traffic on non-toll network is underpriced
 opportunity for a charging scheme ?
But : monitoring costs are significant
 need to balance two contradictory objectives :
– « revenue raising approach » (limit to
« monopolistic » sections of the network)
– « welfare maximisation approach » (benefit from
cross – elasticities)
N.B : Peak - off peak pricing has proved to have significant
impacts on car behaviours with communication
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– (A1 : North motorway ; A10 : Atlantic motorway ; A5-A6 :
South-east motorway).
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Vehicles
Context : significant technical progress on new
vehicles and turn over of vehicle fleets slowdown
 opportunity for incentives to accelerate innovation diffusion ?
Assessment of various tax-subsidy schemes to new
less polluting vehicles
–
–
–
–
Particle filters on cars, buses or trucks
Electric cars
CO2 bonus-malus on new cars
Replacement of old cars, vans, trucks to new (Euro IV)
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Vehicles
Assessment based on 2001 external costs
Net present value of external costs avoided
/ Net present value of accelerated replacement of vehicles
Technology
Service
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External cost avoided / extra cost
Particulate filters buses
400
Electric cars
0,2
LPG cars
0,6
Particulate filters cars, trucks
forthcoming
Replacement of old cars, vans, trucks
forthcoming
DAEI/SES
Urban
Main pricing instruments (fuel + vehicle taxes) are not
available at the local level
Parking pricing is a classical instrument, but distorted by
private parking development, which is hardly regulated
Welfare benefits of congestion charges are well
documented (cf. London)
But local authorities are reluctant to congestion charges
unless infrastructure-based
 Is there a correct incentive to local authorities ?
Externalities are both
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– « internal » (congestion, noise and local pollution)
– « external » (regional pollution and climate change)
 No incentive to reduce CO2 and regional pollution
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Urban
Relevance of issues
Relevance of instruments (* to ***)
Availability of instruments * or (*)
Cost
Instrument
Fuel taxes
Congestion
Service
économique
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Local
pollution
CO2
(**)
(***)
(***)
(***)
(*)
*
*
**
(*)
Vehicle taxes /
subsidies
Charges
Noise
***
 would an incentive to local authorities on CO2 help implement
congestion charges (e.g. tradable permits, subsidies) ?
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Air traffic
Service
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Fuel taxes or en route charges are first best instruments to
deal with climate and regional pollution
Welfare surplus is well documented, namely thanks to
technical progress on fleets (cf. EU study, 2001)
But International coordination is difficult (cf. ICAO)
Noise, air pollution, and congestion also become
problematic at the local level (airports)
Available assessments show that incentives on noise and
air pollution (landing charges) have an impact on fleets
structures, even though not harmonized internationally
 Local pollution and CO2 : win-win policies
 Trafic competition and aircrafts competition : trade-offs
DAEI/SES
Issues : pricing and cost assessment
Marginal versus average costs and revenue raising :
– pricing optimality is based on marginal costs
– (with the condition that  revenues > stand alone costs)
Revenue raising and earmarking : not a pricing issue
– unless expenditures portfolio becomes the basis for tax policy
– if so, the risk is to focus on revenue raising : low rate + broad base
Infrastructure (capacity) versus congestion :
– If prices and investments are optimal, congestion = capacity costs
– otherwise, congestion costs should be prefered unless prices are
meant to regulate over investment
– Peak - off peak costs need to be differenciated based on
congestion costs
Landscape fragmentation costs : fixed or traffic-sensitive ?
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– Cf. debate on capacity costs
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Issues : pricing and cost assessment
Accidents : specific value of life ?
–
–
–
–
–
Age specificities
Higher willingness to pay to avoid accident (violent)
Self-internalisation (30% assumed on raod trafic in France)
Behavioural trends / inflexions (cf. France)
Revenue-influence
Noise :
– Abatment versus protection versus perception :
housing markets are not perfect, especially for poor people :
willigness to pay to reduce noice > real expenditures
– Urban areas : average traffic versus infrastructure-based
Climate change :
Service
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– « Kyoto » (national ceiling) or « early acions » approach : value of
CO2 tends to be higher in the short term
– « Adaptability » approach : prices must increase with time
– But no specific discount rate
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Issues : pricing and cost assessment
Air pollution :
– Unit value of years losts : inflence of age
• (in France 0,6 when > 60 years)
–
–
–
–
Unit value of morbidity years : quality-adjusted life
Number of years losts : epidemiological controversy
Specificities of dense zones : density is the main cost driver
Specificities of confined areas : density + topography are
costs drivers
• (in France : estimated adjustment factor = 15 in valleys)
Norms and costs :
– Emissions even below norms are still external costs
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DAEI/SES
Main references
Report to the Commission, joint expert group on
transport and environment, january 2004 (Angel
Aparicio ; Xavier Delache)
European environmental agency, price signals report,
september 2004
Choix des investissements et coût des nuisances,
Commissariat général du Plan, 2001
Instruction cadre pour l’évaluation des projets
d’infrastructures de transports, mars 2004
Couverture des coûts et des infrastructures routières,
septembre 2003 (Xavier Delache & alii)
Commission for Integrated Transport, congestion
charge, 2002
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Thank you
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